For the Internet companies, who've been annoyed at the MPEG-LA video patent fees for ages, this was the last straw. Seven leading Internet companies today announced formation of the Alliance for Open Media. This open-source project will develop next-generation media formats, codecs and streaming technologies. The Alliance's founding members are Amazon, Cisco, Google, Intel, Microsoft, Mozilla, and Netflix.

The new Alliance is working together to create top-quality video, audio, imagery and streaming technologies that will work across devices of all kinds .

The Alliance's initial focus is to deliver a next-generation video format that is:

Interoperable and open;

Optimized for the web;

Scalable to any modern device at any bandwidth;

Designed with a low computational footprint and optimized for hardware;

Capable of consistent, highest-quality, real-time video delivery; and

Flexible for both commercial and non-commercial content, including user-generated content.

This initial project will create a new, open royalty-free video codec specification. This will be based on the contributions of members, along with binding specifications for media format, content encryption and adaptive streaming.

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Jonathan Rosenberg, CTO of Cisco Collaboration Technology Group, added in a statement, "We have been very vocal about our desire to deliver a royalty-free codec and we believe that joining the forces of the designers of the Daala, Thor, and VPx codecs in [the Alliance] will multiply our collective efforts to deliver next-generation media codecs, formats and technologies."

The goal of the Alliance, said Gabe Frost, the Alliance for Open Media's Executive Director, is to bring together "the leading experts in the entire video stack to work together in pursuit of open, royalty-free and interoperable solutions for the next generation of video delivery."

Of course, not everyone is on board. Besides the video patent holders, Apple, Adobe, Facebook, and Hulu haven't joined. They're welcome to join. Bryant said, "The initial members are just a start. We invite anyone with an interest in video, online or off, to join us."

Still, this alliance of powerhouse companies is the best news for a free,open-source video codec in years.